Hydroponics: The Next Generation Agricultural Approach
Hydroponics involves the process of growing plants using mineral nutrient solutions in sand, gravel, or liquid, without using soil. Due to the increasing success rates associated with the commercial hydroponics industry and the increasing difficulty of growing in soil, the hydroponics market is expanding exponentially. Many out-of-season fruits and vegetables can be produced year-round under controlled conditions using hydroponics. The main countries that actively practice hydroponics are the United States, Australia, Spain, the Netherlands, Canada, New Zealand, Italy, Mexico and China. The main crops grown hydroponically are cucumbers, lettuce, tomatoes, peppers, strawberries, leafy vegetables, aromatic herbs, cut flowers, etc. This method is widely adopted due to its integrated pest management approaches.
Hydroponics – Market dynamics
Hydroponics is considered one of the fastest growing soilless farming practices globally, where a customized nutrient solution, which is of superior quality, helps a plant grow sustainably. One of the main growth drivers for the hydroponic industry is the higher documented yields compared to traditional farming techniques. Along with profitable agriculture, the increasing consumption of exotic salad crops and the increasing need for global food security are the factors that are expected to drive the market. The lack of knowledge about the soilless agriculture system and the high initial cost are the factors that could hinder the growth of the market. The increase in cultivation of medicinal plants, globally, and the custom cultivation approach may provide future growth opportunities for the industry.
Will hydroponics revolutionize the way of irrigation?
According to a report by a market intelligence company, the global hydroponic market is estimated to register a CAGR of 6.5% during the forecast period 2017-2022, and the market value is anticipated to reach 30,849.83 million USD by 2022. The growth of the hydroponics market is mainly due to the increasing focus on the adoption of innovative and efficient technologies to improve yields. Tomato is one of the main crops grown through the hydroponic system, worldwide. According to a USDA/ERS report, the volume of imports of hydroponic tomatoes from countries such as Canada, Mexico, and the Netherlands has increased dramatically, with imports now accounting for a significant portion of total fresh tomato imports for the US market. Lettuce and leafy vegetables, peppers, cucurbits and other vegetables are increasingly grown using hydroponics.
According to our analysts, Europe is traditionally the largest market for hydroponics, implementing advanced techniques in smart greenhouse hydroponic horticulture. The mature demand of the European market for hydroponics is led by countries such as the Netherlands, Spain and France. Asia-Pacific constitutes the second largest market for hydroponics, which is expected to grow steadily during the forecast period. The North American region, led by the United States and Canada, is expected to grow at an improved rate during 2017-2022.
Competitor analysis
The global hydroponics market is concentrated in the main technically advanced regions. Greentech Agro LLC, Argus Control Systems, Logiqs BV, Koninklijke Philips NV, General Hydroponics Inc., Greentech Agro LLC, and Lumigrow Inc., are some of the major players active in the industry. Industry players are constantly embracing R&D related to region and area specific requirements. Mergers and acquisitions are also one of the key activities adopted by major players. Lawn and garden giant Scotts Miracle-Gro spent $136 million on Gavita, a Dutch grow lighting and hardware company. Through its subsidiary, Hawthorne Gardening Co., Scotts Miracle-Gro invested in companies including Boulder-based AeroGrow, an indoor gardening company, and acquired General Hydroponics Inc. of California for $130 million. The company also spent $77.1 million to acquire Botanicare.